Palo Alto appears to raise 'impact fees' for parks, libraries and group facilities

For decades, builders on the lookout to create households or places of work in Palo Alto and in other places have experienced to pay influence charges to make certain the city’s latest inhabitants and workforce will not likely diminish the excellent of local parks, libraries and local community centers.

Now, Palo Alto is thinking of a sharp maximize that is now providing some Town Council associates sticker shock. The city is doing work with a consulting business on a new nexus examine, which examines the city’s demographics, land value and breadth of local community services and which is applied to deliver authorized justification for the new expenses. The draft of the examine, which the council’s Finance Committee talked about before this month, implies that some of the impact expenses could be elevated by a component of five.

The study’s methodology, in accordance to a report from the Community Providers Section, makes sure that the city’s services are “appropriately made and sized so that long term residents and employees do not trigger a reduction in LOS (stages of support) by unduly burdening the infrastructure system, hence foremost to decay and deterioration.”

Kristen O’Kane, director of the Community Providers Section, reported the city had made the decision in November 2019 to undertake the nexus examine just after recognizing that a change to the cost framework is prolonged overdue. The town previous revised its effects charges for parks, community facilities and libraries about 20 a long time in the past, she said at the Dec. 15 meeting of the council’s Finance Committee.

The largest adjust involving then and now is the benefit of land. The current cost framework is primarily based on a valuation of $5.1 million for each acre. The nexus analyze by the San Jose-centered agency DTA proposes revising it up to $5.7 million. This would position the city in a better tier amid Santa Clara County jurisdictions, powering only Los Altos ($9.58 million) and Sunnyvale ($5.8 million).

The revision would have significant ramifications on the city’s charge framework. Park impression service fees, for example, would go up from the existing level of $12,436 for a new one-household property to $59,461. For a new multifamily housing unit, the fee would go up from $4,116 to $43,997.

Professional developers would also see a sharp boost, with the park fees likely up from the present-day stage of $5,281 for just about every 1,000 square feet of new advancement to $14,730.

Even though affect service fees for libraries and group facilities are significantly reduced than for parks, they could also see a substantial hike. Library costs, for instance, could be elevated from $1,126 for a new solitary-household property — or $1,676 for a one-relatives dwelling of more than 3,000 square toes — to $2,739 for each types beneath the new rate composition. For a device in a multifamily intricate, the rate could be elevated from the present-day degrees of $370 (for units more compact than 900 square ft) and $674 (for these bigger than 900 square ft) to $2,026.

Collectively, the effects charges in the 3 categories are projected to convey in about $3.1 million each year, according to personnel. By distinction, the town only gathered $1.1 million in revenues in fiscal years 2018 and 2019, with park fees producing up $935,889 of that total.

Nate Perez, running director at DTA, underscored that the new fees stand for the maximum that the city can justifiably cost. The council will have the choice of environment service fees below the levels suggested in the nexus examine or adopting a a lot more gradual boost.

Perez attributed the large improves proposed in the research to the prolonged period of time of time that has elapsed considering the fact that the previous revision.

“The payment by itself, in complete dollar figures, is increasing really a bit,” Perez mentioned. “I will observe it hasn’t been up-to-date in 20 yrs, and we know how significantly real estate has absent up in 20 years, so the reality that land valuation has absent up in the same way should not be as well astonishing.”

Whilst he acknowledged that the proposed costs stand for a considerable “leap,” he identified as the revision “affordable” and “incredibly, pretty extremely defensible offered the lag.”

Council members, for their portion, showed small appetite for elevating fees so abruptly and substantially. Vice Mayor Tom DuBois proposed that the council think about numerous options for phasing in the cost raise in excess of time. Council member Liz Kniss supported raising the charges but in the same way proposed that the system for doing so need to be spread out over a selection of yrs.

“They are rather hefty,” Kniss explained. “It’s our executing that we failed to do it in advance of, but it shouldn’t be foisted on our residents since we didn’t do this before and suddenly we’re going to make it up for the 20 years that we failed to do it.”

By a 2-1 vote, the committee directed staff and DTA to appear up with a listing of solutions that the comprehensive council can look at for incrementally expanding the affect costs. Council member Greg Tanaka dissented and argued towards boosting the expenses. Carrying out so, he argued, could discourage builders from producing in Palo Alto and hinder the council’s skill to achieve its objective of developing 300 new housing models per 12 months.

“My worry is that this will make a tough surroundings for housing even more durable — way tougher,” Tanaka stated. “I’m anxious about the affect it will have, particularly when this is a person of the plans that we are trying to realize.”